Darren J. Check

The Problem a Global Portfolio Creates

A large institutional investor holds thousands of positions across dozens of markets, and it will be harmed by corporate misconduct somewhere in that portfolio in any given year — often without knowing it.

The harm does not announce itself. It arrives as a price decline among many price declines, in a security the fund may have bought through a manager it delegated to, in a market whose law it has never had occasion to study. And it arrives with a clock already running.

American securities litigation once absorbed most of this. That changed with Morrison v. National Australia Bank, in which the United States Supreme Court held that the principal federal antifraud provision reaches only securities listed on domestic exchanges and other domestic transactions — a ruling that closed the U.S. class action to investors who had purchased foreign-listed shares abroad.

The consequence for a global fund was structural. The same corporate fraud might be actionable in the United States for the shares bought in New York and actionable only in Amsterdam, Tokyo, or London for the shares bought there. Recovery stopped being a question of whether a claim existed and became a question of which forum, on what timetable, under whose procedure — and whether anyone was tracking it.

Check's practice is built on that question. He works with investor clients across the United States, Canada, the United Kingdom, and continental Europe — Sweden, Denmark, Norway, Finland, the Netherlands, Germany, Austria, Switzerland, Italy, France — as well as Australia, and his career has spanned direct actions involving BP, Vivendi, and Merck and class litigation involving Bank of America, Lehman Brothers, Royal Bank of Scotland, and Hewlett-Packard. The firm's investor client base numbers in the hundreds of investors with trillions of dollars under management, and the monitoring practice matches those portfolios to potential claims.

From Portfolio Loss to Viable Claim

He manages the firm's SecuritiesTracker portfolio-monitoring and filing service, working with security identifiers, purchases, sales, opening positions, custodians, investment managers, and account structures to determine whether an investor traded during a relevant period, holds an eligible claim, or faces a filing or opt-in deadline.

Identifying a loss and identifying a viable claim are different exercises.

A claim requires a chain: the challenged statement or corporate act, the later information that contradicted it, a legally available remedy, a forum with jurisdiction, and the investor's actual holdings in the specific instrument during the specific window. Break any link and the loss is real but unrecoverable.

The complications are technical and decisive. Foreign purchases may fall outside a United States class entirely. Debt instruments may follow different disclosure and jurisdiction rules from common stock in the same issuer. The relevant identifier may differ across markets for what is economically the same security. Check organizes those variables while the limitations and opt-in periods remain open — which is the only time the analysis has any value.

Check coordinates with litigators and the firm's new-matter team to compare the available routes: a United States class action, an individual claim, a foreign collective proceeding, arbitration, appraisal, or continued monitoring.

Who Signs the Authorization

He consults with pension funds, asset managers, mutual funds, hedge funds, insurers, sovereign wealth funds, and central banks — organizations that reach decisions through very different machinery.

A public pension board may need agenda materials prepared in advance and reviewed by its own counsel before it can act at a scheduled meeting. An asset manager may be coordinating positions held across several funds with different mandates. A global investor may require approvals in more than one office and more than one jurisdiction.

The analysis must reach each client in time and in a form its governing process can use. Check presents it so boards, trustees, managers, and investment officers can authorize the next step before the applicable deadline.

For an established common fund, his claims-filing work addresses eligibility, recognized loss, required documentation, submission dates, and the governing allocation plan. Accurate records and a complete submission connect a favorable class result to the investor entitled to share in it.

Data security is part of the process, because a holdings file is a disclosure document in its own right: it can reveal managers, strategies, and portfolio exposures. SecuritiesTracker gives monitoring clients controlled access to portfolio matching and claim information while the firm's safeguards protect transaction and account data.

Check also advises investors considering service as a named plaintiff about document preservation, trade verification, client oversight, and the other participation duties that role carries.

The Dutch Mechanism

Check's early cross-border work centered on the Netherlands, which had developed something no other European jurisdiction offered: a statutory procedure allowing a court to declare a negotiated settlement binding on an entire defined group of injured parties, subject to an opt-out.

That feature gave Amsterdam a mechanism for making a negotiated resolution binding across a defined group. Without such a mechanism, individually assertable claims can remain after settlement; a court order supplying group-wide effect changes what the parties are able to resolve.

In Royal Dutch Shell, Check helped pursue a Dutch-law recovery exceeding $350 million concerning European-traded shares and Shell's reclassification and restatement of oil and gas reserves. The proceeding provided a non-United States mechanism for investors whose relevant securities had traded abroad — a template, before Morrison made one necessary, for what global recovery practice would soon require everywhere.

American class procedure did not transfer unchanged, and the differences were not minor. The proceeding required Check and the team to coordinate investors, local procedural rules, corporate records, group definitions, notice, and qualifying trades — and to explain to each investor who could participate, which law applied, how the group would be recognized, and which transactions supported payment.

In Fortis, investors alleged misrepresentations concerning collateralized-debt exposure and the effect of the proposed ABN Amro acquisition on the bank's solvency. The action survived jurisdictional challenges in the Netherlands and contributed to a multiparty $1.5 billion resolution approved by the Amsterdam Court of Appeals in 2018 — the largest investor settlement in Europe to that date. Check was actively involved in the proceeding and advised investors on participation in the Dutch structure.

More Than One Hundred Funds

Check has also worked with investors in Japan, where the route to recovery is different again — assembled groups of claimants rather than a representative class.

The Olympus accounting matter ended in an 11 billion yen payment.

For Nissan investors, Check helped assemble and advise a group of more than one hundred funds: coordinating Japanese counsel, gathering opening and closing holdings tied to the relevant international security identifier, estimating losses, and organizing each fund's participation decision.

For a group of more than one hundred funds, custodial records arrive in different formats, denominations, and conventions for opening positions. Check's team reconciles them into one coherent claim schedule, because each participant's recovery is calculated from the transactions submitted on its behalf.

The London Whale

In JPMorgan's London Whale matter, Check helped secure a $150 million class fund after certification and mediation, working on the pleadings, the evidence, class treatment, communication with institutional investors, and the negotiated resolution.

That case followed the conventional American class-action route, unlike the Dutch collective-settlement and Japanese claimant-group matters. After Morrison, Check's work has required comparing all three procedures and advising each client which one fits its transactions.

Class or Direct

Check advises investors on the choice among class participation, direct actions, foreign proceedings, and arbitration — comparing the investor's transactions, potential claims, available forum, degree of control, discovery duties, preclusion risk, timing, and enforceability, then connecting the chosen route to the required client authorization and the counsel team that will handle it.

In a class, investors share counsel, the court supervises allocation, and the individual fund carries almost no burden — but it also has no control over the pleading, the theory, or the timing, and it accepts whatever the class receives.

A direct action gives one investor control over its own complaint, may permit claims or defendants a class cannot pursue, and can produce a different recovery. It also imposes discovery obligations on the fund itself: document preservation, custodian searches, and testimony about its own investment process.

Check connects those distinctions to transaction history, client authority, forum rules, and deadlines before the investor commits to a route — because most of these decisions cannot be revisited.

Practice

Check is a partner of Kessler Topaz Meltzer & Check LLP and its Director of Institutional Relations. He earned his J.D. from Temple University Beasley School of Law and works from the firm's Radnor office, coordinating investor relationships and filing decisions before applicable deadlines.